The 2022 General Assembly Session is beginning to wind down. They are scheduled to adjourn Sine Die Saturday, March 12th. Below you will find a summary of issues that have seen action in the last week.
Click here to view a full list of bills we are tracking.
House Commerce and Energy Subcommittee #4 laid the bill on the table and the Chairs of House Commerce and Energy, Senate Commerce and Labor, House General Laws, and Senate General Laws are going to send a letter to the Office of the Attorney General to conduct a workgroup in the off-season on this issue, with a report back to the Legislature. This workgroup will consist of industry experts from both brick and mortar and online marketplaces, as well as law enforcement professionals.
The Senate and the House have differing versions of this legislation and the issue will end up in conference and be worked out over the coming week.
SB 494 - McClellan - Virginia Human Rights Act; nondiscrimination in employment; definition of employer. House General Laws Subcommittee recommends reporting and referring to House Commerce and Energy Committee (7-Y 1-N)
In this article:
Accelerated Sales Tax (AST) | Unemployment Insurance Fund | Rebuild Virginia | Polystyrene Ban | Grocery Tax
Both the House and the Senate released committee-approved amendments to the introduced budgets over the weekend. Any differences between the two will have to be worked out in Conference Committee over the coming weeks.
Below is a summary of a few of the key budget-related issues to the retail industry. You can find the full list of both Senate and House Committee Approved Amendments to the introduced Budget here.
Accelerated Sales Tax (AST)
The House budget includes an amendment that eliminates AST in the fiscal year 2022. The Senate budget did not include this amendment, so it still eliminates AST in the fiscal year 2023. (Item 3-5.06 #1h)
Unemployment Insurance Fund
The House budget includes an amendment that deposits $180.0 million of remaining federal American Rescue Plan Act funds into the Unemployment Insurance (UI) Trust Fund in order to eliminate the fund builder UI tax for all employers in tax year 2023. (Item 479.20 #2h)
The House also included an amendment that instructs the VEC to exclude the Unemployment Insurance fund builder tax from an Employer’s 2023 UI Tax rate. (Item 370 #1h)
The Senate included an amendment that ensures that the Unemployment Trust Fund’s fund building rate shall be set for Calendar Year 2023 at a rate not to exceed the rate in effect for Calendar Year 2020. (Item 370 #7s)
There is an amendment in the House budget to use ARPA funds to make a deposit into Rebuild Virginia which is anticipated to fund all remaining eligible applications that were submitted prior to November of 2020. However this was not found in the Senate budget, so it will need to be worked out in conference if this remains in the final budget adopted by both Bodies. (Item 479.20 #1h)
Both the House and the Senate included amendments to delay the prohibition on the use of polystyrene containers by 5 years, until July 1, 2030. (Item 377 #1h and Item 377#1s)
Both the House and the Senate introduced amendments on this issue. The House amendment completely eliminates the grocery tax (Item 4-14 #3h), and the Senate amendment eliminates only the State portion (1.5%) of the grocery tax (Item 4-14 #1s).
Nonpayment of Wages
We have reached the point of Crossover in the 2022 General Assembly Session. This is the point where all legislation that has passed out of its Body of origin, will now crossover and be heard by the other Body. If legislation has not passed out of its body of origin by this point, then it is dead for the year.
In addition, Sunday, February 20th, is Budget Sunday which is when the Budget will be presented by both the House and the Senate. Once we have reviewed the presented versions from each Body, we will send a report with pertinent information to members.
Below you will find a list of major legislation that we are tracking, and the status of that legislation at the point of crossover. To view our complete tacking list of bills, click here.
ABC | Class Action and Arbitration | Consumer Protection Act | COVID-19 | DRAM Shop Liability | Employer Mandates | Environmental | Felony Larceny Threshold | Food Delivery Platform | Grocery Tax | Inform Act | Limited Liability Companies | Mandatory Opt-Out for Automatic Renewal | Minimum Wage | Misclassification of Workers | Nonpayment of Wages | Other Tax Issues | Overtime | Paid Leave | Permit Issues | Privacy | Private Cause of Action Against Employers | Product Ban | Sales Tax | Short-Term Rental | Small Business | Tax Conformity | Tobacco Retail Licenses | Unemployment-Workers Compensation
Several bills were introduced that relate to minimum wage. Delegates Marshall, McNamara, and Freitas, and Senator Peake all introduced legislation that sought to freeze Virginia’s minimum wage at the current rate of $11 an hour. The legislation also repealed the rest of the provisions relating to increasing the state minimum wage based on an annual adjusted minimum wage determined by the Department of Labor and Industry. Of these, the only remaining active legislation are Delegate Freitas which passed the House as introduced, and Delegate McNamara’s which was amended to include Healthcare benefits in the wage calculation for any increase after $11 an hour.
In addition, Delegate Phillip Scott introduced HB1040 which exempts small employers, defined as those with 10 or fewer employees from the state minimum wage requirements. Meaning that they would be only required to comply with federal minimum wage requirements. This legislation has passed the House and will be heard in the Senate.
The Inform Act is legislation that was introduced to help improve safety and transparency on online marketplaces. This is accomplished by requiring the Online Marketplaces to collect and verify information on the identity of high-volume third-party sellers, as defined in the legislation as a seller who makes 200 or more discrete transactions and $5,000 or more in gross revenues in a continuous 12-month period over the past 24 months.
One of Governor Youngkin’s initiatives is to eliminate the Grocery Tax in Virginia. There are several pieces of legislation that have been introduced to eliminate tax (state, regional, and local sales taxes) on food purchased for human consumption and essential personal hygiene products. The two remaining active pieces of legislation are the Senate version, introduced by Senator Boysko, and the House version, introduced by Delegate McNamara. There are differences between these two that will most likely need to be worked out in Conference.
Several bills were introduced to increase the sales tax in certain localities in order to support school construction projects. We have seen these bills pass the last several years, however, the only remaining active legislation are the three Senate bills. One, in particular, is worth noting (SB472) because it authorized all counties and cities to impose an additional local sales tax at a rate not to exceed 1%, with the revenue to be used only for capital projects for the construction or renovations of schools. This would mean that localities that have not already implemented this 1% sales tax rate increase would no longer be required to come to the General Assembly to seek passage of legislation to get their name added to the list of localities allowed to implement the increased sales tax.
Multiple bills were introduced that will correct the issues caused by the Virginia Overtime Wage Act passed last year. Delegate Ware and Senator Barker are the patrons of the remaining legislation that will import all the exemptions on the Fair Labor Standards Act (FLSA) into state law, as was intended when the original legislation passed in 2021. The legislation states that, for purposes of the Virginia Overtime Wage Act, the term “employee” does not include certain people excluded from the definition of “employee” under FLSA and that the employer may assert an exemption to the overtime requirement of the Virginia Overtime Wage Act for employees who meet certain exemptions in FLSA. In addition, both pieces of legislation include provisions on wage calculation that were also left out of the 2021 legislation.
As in years past, multiple pieces of legislation were introduced on the topic of paid leave that mandate paid leave for employers. Of the introduced legislation, only a few remain active after Crossover, including the legislation introduced by Delegate Byron and Senator Favola which creates a class of insurance for family leave. This policy would be available for employers to provide for employees as a part of their benefit program if they so choose, but it would not be mandated.
SB 65 - Ruff - Alcoholic beverage control; distiller licenses to allow Internet orders and shipments. Passed by Indefinitely (defeated) by Senate Rehabilitation and Social Services Committee (13-Y 1-N)
We have wrapped up week four of the 2022 General Assembly Session. Next Tuesday, February 15th, is Crossover, therefore all action must be taken on legislation in the Body of origin by then. If action is not taken before Midnight on February 15th, then the legislation will fail to Crossover and will be dead for the year. Below is a summary of key legislation that has had action in the last week.
To view our complete tracking list, please click here.
Minimum Wage | Paid Leave | Inform | Employer Mandates | Permit Issues | ABC | Small Business | Privacy | Nonpayment of Wages | Overtime | Sales Tax Increase | Elimination of Grocery Tax | Conformity and PPP Deductibility | Food Delivery | Class Action and Arbitration | Unemployment Compensation and Workers Compensation | Other Tax Issues
SB 1 - Boysko - Paid family and medical leave program; Virginia Employment Commission required to establish. (S) Carried over for the year (defeated ) by Senate Commerce and Labor Committee) (15-Y 0-N)
SB 352 - Surovell - Health care providers and grocery store workers, etc.; employers to provide paid sick leave. (S) Senate Commerce and Labor Committee Rereferred to Finance and Appropriations Committee (12-Y 3-N)
SB 341 - Barker - Consumer protection; online marketplace, high-volume third-party sellers. (S) Reported from Senate General Laws and Technology Committee (7-Y 3-N 5-A). Is now on the Floor of the Senate.
Sales Tax Increase
Under current law, only Charlotte County, Gloucester County, Halifax County, Henry County, Mecklenburg County, Northampton County, Patrick County, Pittsylvania County, and the City of Danville are authorized to impose such a tax.
Elimination of Grocery Tax
Other Tax Issues
Conformity and PPP Deductibility
HB 971 - Byron - Commonwealth's taxation system; conformity with the Internal Revenue Code, etc. (H) VOTE: Passage Emergency (100-Y 0-N) -EMERGENCY Legislation (which means it requires a 2/3 vote and it goes into effect as soon as the Governor signs it)
SB 94 - Howell - Commonwealth's taxation system; conformity with the Internal Revenue Code, etc. (S) Reported from Senate Finance and Appropriations Committee (16-Y 0-N). Now on the Floor of the Senate – EMERGENCY Legislation (which means it requires a 2/3 vote and it goes into effect as soon as the Governor signs it)
SB 393 - Ebbin - Consumer Data Protection Act; data deletion request. (S) Reported from Senate General Laws and Technology Committee with a Substitute (14-Y 0-N 1-A). Is now on the Floor of the Senate
HB 455 - Knight - Casino gaming; sale and consumption of alcoholic beverages in establishments, etc. (H) Reported from House General Laws Committee with Substitute (19-Y 2-N). Is now on the Floor of the House.
SB 254 - Bell - Alcoholic beverage control; delivery of alcoholic beverages, third-party delivery license. (S) Reported from Senate Rehabilitation and Social Services Committee with a Substitute (12-Y 2-N). Is now on the Floor of the Senate.
SB 519 - Lucas - Casino gaming; sale and consumption of alcoholic beverages in establishments, etc. (S) Reported from Senate General Laws and Technology Committee with Substitute (13-Y 2-N). Is now on the Floor of the Senate.
Class Action and Arbitration
SB 309 - Edwards - Consumer Protection Act; prohibited practices, certain restrictive provisions. (S) Reported from Senate General Laws and Technology Committee (8-Y 7-N). Now on the Floor of the Senate.
Unemployment Compensation and Workers Compensation
HB 652 - Wampler - Unemployment compensation; notice of hearing prior to discontinuing benefits, etc. (H) Reported from House Commerce and Energy Committee (22-Y 0-N). Now on the Floor of the House EMERGENCY Legislation (which means it requires a 2/3 vote and it goes into effect as soon as the Governor signs it)
Non-Payment of Wages
We wrapped up week three of the 2022 General Assembly Session and several issues important to the Retail Industry have started to make their way through the legislative process. Below is a summary of key legislation that has had action in the last week.
To view our complete tracking list, please click here.
Minimum Wage | Paid Leave | Conformity | DRAM Shop | Employer Mandates | Mandatory Opt-Out for Automatic Renewal | Workers Compensation | Other Tax Issues | Limited Liability Companies | Permit Issues | COVID-19 | ABC | Small Business | Privacy | Environmental | Nonpayment of Wages | Overtime
Several pieces of legislation have been introduced on the topic of paid leave. Many of them mandate paid leave for employers. However, the legislation introduced by Senator Favola creates a class of insurance for family leave. This policy would be available for employers to provide for employees as a part of their benefits program if they so choose, but it would not be mandated. This is an option for businesses that cannot afford to offer a robust paid family leave program individually but would like to be able to provide such benefits for their employees. Delegate Byron is carrying the companion bill in the House, and it should be heard in Committee later this week.
Delegate Byron is carrying the 2022 Conformity legislation. As introduced the bill also dealt with the PPP deduction for taxable year 2020. However, an amendment was offered in House Appropriations Committee that removed that portion of the bill. This was done because there is an emergency clause on the legislation which requires an 80% vote in favor to pass. There will still be an effort to deal with taxable year 2020 deductibility cap in other legislation that does not require an emergency clause.
Mandatory Opt-Out for Automatic Renewal
Other Tax Issues
Limited Liability Companies
Nonpayment of Wages